Interpreting Middle East Economic News and Analyzing Market Trends

Category: Islamic Finance

Macroeconomic Outlook for Kuwait and the GCC

I was invited to speak at the IFN Forum Kuwait, which was held in Kuwait on October 19, 2015.  I gave a presentation on my outlook for Kuwait and the rest of the GCC countries in light of the 60%+ fall in the price of oil over the past year.

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The next financial crisis and how it will affect GCC countries

 

This is a presentation I gave recently in Dubai discussing my new book titled ‘Islamic Finance and the New Financial System: An Ethical Approach to Preventing Future Financial Crises.” 

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Forget about Sukuk, it’s time to talk about Salaf Bonds!

HM Treasury Sukuk

This article is re-posted from Islamic Finance News, volume 12 issue 10, published on March 11, 2015.

It would have been unimaginable a few years ago to talk about negative bond yields much less witness this phenomenon happening right before our eyes.  The reality is that today we are seeing an increasing number of bonds in Europe and Japan falling into negative yield territory.  The Wall Street Journal estimates that there are currently $1.7 trillion in bonds trading with negative yields and the number is growing daily.

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Rising uncertainty for the sukuk market in 2015

S+P Total Sukuk Market Issuance

Source: Standard and Poor’s Ratings Services

 

 

In 2014 we saw for the first time the rise of non-Islamic sovereign issuers of sukuk.  The governments of Hong Kong, Luxembourg, South Africa and the UK all issued sukuk for the first time in 2014.  This marks the starting point of a trend that is expected to increase in the coming years.  However, with fizzling global growth expectations from the IMF coupled with crashing oil prices, can the sukuk market maintain its momentum?

 

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Are Islamic banks riskier than conventional banks?

Islamic Bank of Britain

Photo: Islamic Bank of Britain in London.

 

 

With global GDP slowing down and constantly being revised lower by the IMF and World Bank, a question has been coming up in the Middle East regarding the safety of the banking system in the region, especially with the crashing oil price.  Islamic banks have been especially criticized in the past for their loose oversight and perceived reckless investment model.  Are Islamic banks really riskier than conventional banks?  Let’s take a look…

 

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